As voting in the world’s largest election comes to an end on Monday with historic polling in Varanasi, all eyes will be on May 16 with Sensex managing to rally a record high of 23,000.
As markets march towards D-day, experts, seeing a high in investor sentiment, predict that Sensex will surge to about 30,000 level by year’s end. Sensex has already managed to rally over 6 per cent this year based on the expectations of a new Government led by Narendra Modi as the Prime Minister.
Analysts on Dalal street have also predicted that the markets will surge to a new high if the Modi-led BJP and its allies bag over 270 seats in the Lok Sabha poll.
On the other hand, the wide-based Nifty of the National Stock Exchange breached the psychological 6,900 mark for the first time to scale a new peak of 7,000 level.
At the moment, all eyes are on the exit polls, which would show that BJP and its allies will win a majority in the current election. On the other hand there could be a sharp sell-off if exit polls go against Dalal Street expectations.
Exit polls predict clean sweep for BJP in Lok Sabha election
A win for a BJP-led NDA will been seen as setting the stage for a revival in confidence, investment and growth in the Indian economy.
BJP and its National Democratic Alliance needs 272 seats in the Parliament, but analysts predict that even getting 250 seats will be enough to form a stable Government.
Meanwhile, analysts say that apart from emergence of profit-booking by funds and retail investors at record levels, there are several other factors like subdued trend in the other Asian stock markets following weak China and Japan’s economic data, increase in FIIs, etc. The strengthening of the Rupee has also raised investors confidence and with timely measure by the RBI.
LS poll final phase: Record 55.34% voter turnout in Varanasi; 79.3% in West Bengal
Markets are already roaring on the Modi wave with stock brokers predicting huge investments after May 16.
“We believe markets will continue to ride the Modi wave and cyclical stocks are the best theme to play in current markets,” said Rahul Shah, vice-president, equity advisory group, Motilal Oswal Securities.
